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Larabee Section 1
Real Property & Ownership
| Term | Definition |
|---|---|
| Adaptation | Adaptation concerns fixtures: How an item fits can determine whether the item is personal property or real property. Basically, if the item is "made" for the specific spot, it is a fixture. For example, window shades are usually fixtures. |
| Agreement of the Parties | The most important test of whether an item is a fixture or not. If you are not sure if an item is considered by the seller/buyer to be a fixture, clarify who gets it in the contract. |
| Air Rights | (also known as air lots) are the those rights to ownership, not including surface rights or sub-surface rights, that allow you to use the open vertical space above a property. |
| Appurtenances | The rights, privileges, and improvements that go with a transfer of the land even though they may not be part of it. Examples are water rights, rights-of-way, and easements. |
| Monuments | Markers used as points of beginning or other corners in metes and bounds descriptions. May be artificial (iron stakes or other man-made) or natural (trees, river centerline) provided by nature. |
| Attachment | The manner in which a fixture is attached will determine whether the item is personal property or real property. Is it attached permanently or can it be moved? |
| Base Lines | East-west imaginary lines, crossing a principal meridian at a specific point, and forming boundaries of Townships in the Government Survey System of land description. |
| Benchmark | A reference point or marker placed by a surveyor and used to establish elevations and altitudes above sea level. |
| Bundle Of Rights | The rights of ownership associated with real property, including the right to use, enjoy, encumber, exclude and alienate, whether by deed, lease or devise by will. |
| Chattels | Items of tangible personal property. As a personal property interest in real property, a lease is known as a chattel real. |
| Check | a.k.a. Quadrangle. A 24 mile by 24 mile parcel in the Government Survey System of land description. |
| Common Elements | The areas in a condominium project or PUD where all owners share an undivided interest and full possession, such as the common area hallways, swimming pool and clubhouse. |
| Common Interest Subdivision | A subdivision that has amenities such as a pool or tennis courts, used by all individual owners. Each owner has an undivided ownership interest based usually on the percentage as a ratio of square footage to the total project square footage. |
| Community Property | Property acquired during a marriage and considered equally owned. Property acquired before the marriage or with separate funds during the marriage is considered separate property. Only used in 10 states, not incl. Colorado |
| Condition Subsequent | Requirement of a defeasible fee (Grantee's title depends on a specific condition). If condition is not met - The estate does not automatically terminate, the owner must go through court and retake the property within a reasonable time period. |
| Condominium Bylaws | Rules and structure for administering a condominium homeowners' association. |
| Condominium Owner's Association | An organizational framework set up for self-governance by owners through adoption and enforcement of bylaws. |
| Contingent Remainder | A known future interest in real property, provided some condition specified in the deed occurs. |
| Cooperatives | A form of multi-unit residential ownership in which a corporation owns property and the shareholders own stock and proprietary "leases" to individual units. |
| Correction Lines | Correction for curvature of the earth back to a full 6 miles made at every 4th township line in the Government Survey System of land description. |
| Curtesy | A husband's legal life estate (1/3 interest) in his wife's property upon her death. (Only in a few states) |
| Datum | A point, line or surface from which a vertical height or depth is measured. |
| Defeasible Fee | a/k/a Qualified Fee. Ownership estate in which fee simple title may be "defeated" by either a) "determinable" (so long as the specific use in the deed continues) or b) a condition subsequent (so long as a certain condition in the deed is not violated.) |
| Dower | Used in some states to represent the interest the wife receives in property owned by her husband at the time of his death. |
| Emblements | Farm crops (fructus industriales) of a tenant farmer, which are sold separately and considered personal property. |
| Enabling Declaration | A statement that commits a property to condominium ownership. It defines the rights and responsibilities of individual owners in respect to maintenance and financial liabilities. |
| Estate | One's legal interest in property - either freehold or non-freehold. |
| Fee Simple Estate | The most complete and absolute ownership of real property. It is freely transferable, has an indefinite duration and may be left to heirs. All other estates are created from a fee simple estate. |
| Fee Simple Determinable | An estate that may be "defeated" by failure of a condition determined in the deed, whereupon title automatically reverts to the grantor. |
| Permanence of Investment | One of four Economic Characteristics of Real Estate. Refers to the long payback period and stable nature of real estate investment. Requires future projections on usage. Zoning can stabilize value as investors can predict future use. |
| Fixture | Personal property item that is permanently attached to improvements, and thus becomes real property. |
| Economic Characteristics of Real Estate | Four: 1) Scarcity; 2) Improvement; 3) Location; 4) Permanence of Investment. |
| Franchise | An independent business that is permitted to use a common trade name after paying a fee and signing a contractual agreement. (e.g. Metro Broker, or Coldwell Banker) |
| Freehold Estates | Real property ownership that are for an indefinite duration. (e.g. fee simple, life estate) |
| Fructus Industriales | Cultivated annual crops that when harvested are personal property. (from Latin "fruit of effort") |
| Fructus Naturales | Plants, trees, and crops that are considered real property because they are not harvested. (from Latin "fruit of nature") |
| General Partnership | A business organizational form in which all general partners actively participate in ownership and management and are liable for all debt and actions. |
| Governmental Survey System | (a/k/a Rectangular Survey System) One of 3 major methods of land description. Used for large parcels in non-urban areas. Based on principle meridians and baselines which form Quadrangles, Townships, Sections and fractions of sections. |
| Improvements | Man made items permanently attached to the land, such as buildings, patios, decks, sidewalks, sewers, etc. |
| Joint Tenancy | A form of co-ownership in which one fee simple title is undivided and shared equally among two or more owners with an automatic right-of-survivorship. Four unities--time, title, interest and possession--are required to create joint tenancy. |
| Joint Venture | A form of business organization in which two or more individuals come together for a business purpose and share in the profits or losses of the venture. It is treated like a partnership for tax purposes. |
| Land | The surface of the earth from its core center up through the sky. Land includes all natural items permanently attached such as trees, water, and minerals. |
| Legal Description | Description of property more accurate than street addresses and required in contracts/deeds/other real property transfers. The 3 major methods of legal descriptions are metes and bounds; governmental survey system; or subdivision (lot, block and tract). |
| Life Estate | An interest in real property limited to the duration of someone's life, either the grantor or other designated person. |
| Limited Common Elements | Those areas in a common interest community reserved for exclusive use by a particular owner, such as decks, storage areas or parking spaces. |
| Limited Liability Company | A form of business organization treated like a limited partnership from a federal tax point of view and an "S" corporation from a liability point of view. |
| Limited Partnership | A business organizational form in which general partner(s) are liable for all debts and actions and limited partners carry no liability beyond the amount of their investment. |
| Lot, Block and Tract | One of the 3 major methods of land description that identifies a parcel by reference to a recorded plat map, using a lot number within a specific block which lies within a specific tract. |
| Master Deed | Describes the physical location of the common and individual elements (units) of a condominium. |
| Metes and Bounds | One of three major methods of land description. Used most often to describe irregular parcels using azimuth and bearing measurements. Metes are a measure of length and bounds are boundaries. |
| Mile | A distance in a straight line measuring 5,280 feet. |
| Mineral Rights | Rights to subsurface minerals, oil, and gas including the rights to remove them. |
| Non-freehold Estate | Less than freehold. A non-ownership or leasehold estate, that a tenant possesses in real property. |
| Partition | A court action or lawsuit to dissolve co-ownership of property when one (or more) co-owners want to sell a property, but others do not. The court may split or partition the property. |
| Personal Property | Movable property, also known as chattels. All property that is not real property, or permanently attached, is personal property. |
| Fee Tail | Yours as long as you have descendants. (not used in all states) |
| Planned Unit Development (PUD) | A community planned with a variety of individual ownership interests such as residential and shared interests of common recreation areas. |
| Point of Beginning (POB) | The starting point, usually a monument, in a metes and bounds land description. For the legal description to be complete, it must return to the POB. |
| Principal Meridian | The main imaginary lines that run north and south, crossing a base line at a specific point. There are 36 principal meridians in the US. |
| Pur Autre Vie | A life estate based on the duration of the life of a person and other than the grantor. (from French "for other life") |
| Quadrangles | An area of land measuring 24 miles on each side. |
| Range | A six-mile wide strip of land or townships which run north and south of a baseline, and numbered east or west of a principal meridian. Used in the Governmental Survey System. |
| Real Estate | Land plus all improvements (things permanently attached to it), running from the center of the earth up through the sky. |
| Real Estate Investment Trusts (R.E.I.T.S.) | Money funds through which small investors participate in large real estate projects through ownership of certificates. REITS are created and managed by brokerage companies. |
| Real Property | Land plus all improvements (things permanently attached to it), and also includes the bundle of rights--interests, benefits and rights inherent of ownership. |
| Plat | The legal description in map form of a subdivision. It contains lot and block numbers and show dimensions of each parcel. Used mostly in urban/suburban areas. Plat maps are "recorded" by filing with the county clerk and recorder |
| Rectangular Survey System | Synonym for Government Survey System |
| Remainder Estate | A life estate that goes to a named third party when the life tenant dies, also known as a vested remainder interest. |
| Right of Survivorship | A key feature of joint tenancy whereby the deceased joint tenant's ownership rights automatically pass to the surviving joint tenant(s). |
| S Corporation | An IRS category of corporation that is treated like a partnership for tax purposes, avoiding taxation of corporate profits and subsequent taxation of dividends to shareholders (double taxation). |
| Sections | One of 36 sub-units within a township that is one mile square in the Governmental Survey System . |
| Securities | Investments regulated by state and federal law where investors are inactive participants. Investment condominiums with a mandatory rental pool agreement are regulated by the Securities and Exchange Commission. |
| States Rights Concerning Property | The legal rights states have concerning all property. These rights are: 1. Protect the health, safety and general welfare of the public (i.e. zoning), 2. Tax the land, 3. Escheat, and 4. Eminent Domain. |
| Subsurface Rights | The rights to ownership below the surface, e.g., mineral and water rights-- not including surface rights or air rights. |
| Surface Rights | Rights to ownership that do not include air rights or subsurface rights: The ground to which you can attach improvements. |
| Survivorship | A feature of joint tenancy or tenancy of the entirety co-ownership whereby upon the death of one tenant, property automatically passes to the remaining tenant(s) rather than to the heirs of the deceased tenant. |
| Syndication | A process for two or more people coming together to operate an investment, such as partnerships, corporations, etc. It is not a form of ownership |
| Tenancy by the Entirety | Legal form of co-ownership in some states between husband/wife giving both spouses equal/undivided interest in the whole property. At death, remaining spouse has a right of survivorship. While living, both parties must sign to sell the property. |
| Tenancy in Common | Form of co-ownership in which two or more owners each owns an individual undivided percentage. May or may not have equal ownership portions & share only the unity of possession. Upon the death of one party, his or her portion is passed to the heirs. |
| Tenancy in Severalty | Ownership by a sole person (individual, corporation, partnership). |
| Testamentary Trust | A trust created at time of death by the will. |
| Tier | A six-mile wide horizontal row of townships running and numbered north or south of a baseline in the Governmental Survey System). |
| Timesharing | Ownership or right-to use interest by multiple owners of undivided interests in a single real property for a specified period of time. Usually a resort condominium or hotel. The time period may be fixed or variable. |
| Township | A 6 mile-square parcel of land in the Governmental Survey System. Contains 36 1 mile-square Sections. |
| Trade Fixture | Personal property attached by a commercial tenant to assist in a trade or business. If the tenant does not remove trade fixtures within a reasonable time after the lease expires, they become the property of the landlord. |
| Testate | Refers to death whereby the deceased leaves a will declaring transfer of property interests to parties named in that will. |
| Undivided Interest | An ownership interest in a percentage of a property, including use/possession of the total property. |
| Annexation | The process of affixing or attaching personal property to the real property so that it becomes a fixture and is considered real property. |
| Severance | 1) Separating real property from attachment to the land (a shed) turning real property into personal property; 2) Termination of a relationship (i.e. a joint tenant transfers his/her interest); 3) Breakup of one parcel of land into two or more parcels. |
| Trustor | A person who creates a trust. |
| Trust | Fiduciary arrangement where an owner (trustor) conveys property or money to a third party (trustee) who administers the trust for the benefit of another person (beneficiary). |
| Living Trust | A type of trust created during the lifetime of the owner (trustor). |
| Beneficiary | The party who benefits from a trust; it is the lender in a deed of trust |
| Trustee | A third party that administers a trust on behalf of the beneficiary and carries out the wishes of the trustor. |
| Inter Vivos Trust | A trust under which property is transferred by a living trustor to a trustee with instructions for management of assets and for distribution of income. Differs from a testamentary trust created by will and effective upon death. |
| Interstate Land Sales Full Disclosure Act | A federal act requiring disclosure of property information to buyers when 25 or more unimproved parcels of land in a subdivision are offered for sale. Subdivisions must be registered through the Office of Interstate Land Sales Registration (OILSR). |
| water rights | Special common-law right held by owners of land adjacent to rivers, lakes, or oceans and restriction the rights of land ownership |
| Condominium Ownership | An estate in real property consisting in an individual interest in airspace within a unit and an undivided common interest in the common areas, such as the land, parking areas, elevators, stairways, etc |
| Corporation | A legal entity created under state law, consisting of an association of one or more individuals but existing separately from such individuals. Managed by its board of directors, the liability of each shareholder is limited to his/her investment |
| Deed Restriction | Provisions placed in a deed to control future use of the property |
| Easement by Condemnation | Government acquisition of an easement for a public purpose through its right of eminent domain. Government must compensate the owner of the servient tenement for any loss in property value |
| Homestead | a tract of land owned and occupied as the family home. In many states a portion of the area or value of this land is protected or exempt from judgments for debt |
| Leasehold Estate | Personal property interest of a tenant giving the right to occupy according to lease terms. Less than a freehold estate. |
| Reversionary Interest | an interest retained by the creator of a life estate if no remainderman is named |
Created by:
tyhart44
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